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Economic malaise forces major Sudan bank to cut staff

February 27 - 2019 KHARTOUM
Headquarters of Tadamon Islamic Bank in Khartoum (Picture: Arab Engineering Bureau)
Headquarters of Tadamon Islamic Bank in Khartoum (Picture: Arab Engineering Bureau)

Tadamon Islamic Bank has decided to reduce employment due to the prevailing economic conditions in Sudan. Tadamon general manager Abbas Abdallah announced in a statement from the bank’s headquarters in downtown Khartoum on Tuesday that staff reductions will begin today.

Abdallah said that the current economic conditions in Sudan made a number of branches of the bank vulnerable to loss. He blamed distortions in the structure of employment and inflation during the first months of this year. Tuesday’s statement did not specify which branches would be affected, or how many jobs will be lost.

Union objects

The Tadamon Bank employees union has objected to the decision to reduce and dismiss workers. It said in a statement to the staff, it had not agreed to the dismissal and displacement of anyone and confirmed that it will work to thwart the decision.

Bankers and economists have warned of the collapse of the banking sector in Sudan at any moment, in the event the government does seriously handle the economic conditions.

The Central Bank of Sudan reports that 98 per cent of the cash mass has been withdrawn from banks because of the recent economic crisis.

Liquidity crisis

The printing of new currency denominations of SDG 100, SDG 200, and SDG 500 by the Central Bank of Sudan has been necessitated by hyperinflation, coupled with a chronic shortage of hard cash. Banks have limited cash withdrawals so traders and the public prefer to keep their cash at home, rather than deposit it into banks.

Over the past few months, as the value of the Sudanese Pound has dropped steadily against the US Dollar. In December 2018, the Central Bank of Sudan issued a decision to set the limit of cash withdrawals by bank cards at ATMs at SDG 20,000 ($421*) a month.

Chronic cash shortages

On January 16, it was reported by Radio Dabanga that the country-wide liquidity crisis continues without a solution in sight. Each day sees hundreds of residents queueing at the cash points throughout the country.

At the time, a teacher reported to Radio Dabanga that he went to more than five cashiers in Khartoum, but they were all empty. He said an employee at one of the banks confirmed the lack of liquidity at the banks, and that any person with a bank account is entitled to withdraw only SDG 500 ($10.50*).

Price rises

The residents of El Nahud and Abu Zabad localities in West Kordofan have criticised the non-reduction of the prices of bus tickets to the capital

Khartoum despite the opening of the Bara-Omdurman road, which has reduced the distance by more than 300 kilometres.

People said that a ticket Abu Zabad-Khartoum still costs SDG 450 ($9.50*), while it was supposed to be reduced to the limit of SDG 250 ($5.25) as the highest ceiling reduced by a reasonable amount.

They demanded a reduction in the prices of the tickets, similar to what has happened with the inhabitants of El Obeid.

As effective foreign exchange rates can vary widely in Sudan, Radio Dabanga bases all SDG currency conversions on the Market Makers Mechanism-determined daily US Dollar rate quoted by the Central Bank of Sudan (CBoS).

 


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